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Are corporate climate efforts genuine? An empirical analysis of the climate ‘talk–walk’ hypothesis

Coen, David; Herman, Kyle; Pegram, Tom; (2022) Are corporate climate efforts genuine? An empirical analysis of the climate ‘talk–walk’ hypothesis. Business Strategy and the Environment 10.1002/bse.3063. (In press). Green open access

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Abstract

This study conducts machine-aided textual analysis on 725 corporate sustainability reports and empirically tests whether climate ‘talk’ within the sampled reports translates into performance ‘walk’, proxied by changes in greenhouse gas emissions over a 10-year period. We find mixed results for the ‘talk–walk’ hypothesis, depending on the type of talk and the associated climate change actors involved. Indeed, our empirical models show that while some climate commitments are genuine, many constitute little more than ‘greenwashing’—producing symbolic rather than substantive action. We attribute this result to false signalling of climate transitioning in order to mislead due to misaligned incentives. An unexpected positive finding of the study is that talk about operational improvements is a significant predictor of climate performance improvement. On the other hand, reactive strategies are consistent with poor climate performance. Our findings highlight the significance of corporate climate strategies other than emissions reductions in assessing the effective contribution of business to the climate transition.

Type: Article
Title: Are corporate climate efforts genuine? An empirical analysis of the climate ‘talk–walk’ hypothesis
Open access status: An open access version is available from UCL Discovery
DOI: 10.1002/bse.3063
Publisher version: https://doi.org/10.1002/bse.3063
Language: English
Keywords: Climate governance, corporate reports, emissions performance, greenwashing, sustainability reporting
UCL classification: UCL > Provost and Vice Provost Offices > UCL SLASH > Faculty of S&HS
UCL > Provost and Vice Provost Offices > UCL SLASH > Faculty of S&HS > Dept of Political Science
UCL > Provost and Vice Provost Offices > UCL SLASH
UCL
URI: https://discovery.ucl.ac.uk/id/eprint/10146060
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